Planit:Present and Future Values Calculator Case Study

From Planipedia

The Present and Future Values Calculator allows you to identify the growth in a single deposit or a series of periodic deposits resultant from interest rates, rates of return or inflation. You can adapt the Present and Future Values Calculator to account for a wide variety of financial components, such as life goals, account growth, growth in deposits et cetera by simply solving for the missing variable of the present or future value.

The Mathematics of Future Value Calculation:

Symbols:

• FV = Future Value
• PV = Present Value
• t = number of periods from now
• k = periodic interest rate

For a single sum:

FV = PV (1 + k)t

Country Specific

Canada English

Example Problem One: If you were to invest $100 for one year at an annual rate of interest of 4%, how much money would you have at the end of the year? Assume interest is compounded annually. Solution Using Present and Future Values Calculator: Select Present and Future Values from the Calculators drop down on the home page. Click on the Radio button to indicate Select the Frequency as annual. In the Number of Payments field enter 1. In the Interest per Year field enter 4. In the Present Value field enter $100. Click the button next to the Future Value field. FV = PV (1 + k)t = $100 (1 + 0.04)1 = $104 Example Problem Two: We will now reverse the above problem and ask how much the future value of $104 one year from now is worth today at a discount rate of 4%. Solution Using Present and Future Values Calculator: Select Present and Future Values from the Calculators drop-down menu on the Home page. Click on the Radio button to indicate Select the Frequency as annual. In the number of payments field enter 1, since the future value is only being discounted once. In % Interest/year field enter 4. In the future value field enter the amount of $104 Click on the button next to the Present Value field. PV = FV ÷ (1 + k)t = $104 ÷ (1 + 0.04)1 = $100

United States of America

Example Problem One: If you were to invest $100 for one year at an annual rate of interest of 4%, how much money would you have at the end of the year? Assume interest is compounded annually. Solution Using Present and Future Values Calculator: Select Present and Future Values from the Calculators drop down on the home page. Click on the Radio button to indicate Select the Frequency as annual. In the Number of Payments field enter 1. In the Interest per Year field enter 4. In the Present Value field enter $100. Click the button next to the Future Value field. FV = PV (1 + k)t = $100 (1 + 0.04)1 = $104 Example Problem Two: We will now reverse the above problem and ask how much the future value of $104 one year from now is worth today at a discount rate of 4%. Solution Using Present and Future Values Calculator: Select Present and Future Values from the Calculators drop-down menu on the Home page. Click on the Radio button to indicate Select the Frequency as annual. In the number of payments field enter 1, since the future value is only being discounted once. In % Interest/year field enter 4. In the future value field enter the amount of $104 Click on the button next to the Present Value field. PV = FV ÷ (1 + k)t = $104 ÷ (1 + 0.04)1 = $100

Argentina

Example Problem One: If you were to invest $400 for one year at an annual rate of interest of 4%, how much money would you have at the end of the year? Assume interest is compounded annually. Solution Using Present and Future Values Calculator: Select Present and Future Values from the Calculators drop down on the home page. Click on the Radio button to indicate Select the Frequency as annual. In the Number of Payments field enter 1. In the Interest per Year field enter 4. In the Present Value field enter $400. Click the button next to the Future Value field. FV = PV (1 + k)t = $400 (1 + 0.04)1 = $416 Example Problem Two: We will now reverse the above problem and ask how much the future value of $416 one year from now is worth today at a discount rate of 4%. Solution Using Present and Future Values Calculator: Select Present and Future Values from the Calculators drop-down menu on the Home page. Click on the Radio button to indicate Select the Frequency as annual. In the number of payments field enter 1, since the future value is only being discounted once. In % Interest/year field enter 4. In the future value field enter the amount of $416 Click on the button next to the Present Value field. PV = FV ÷ (1 + k)t = $416 ÷ (1 + 0.04)1 = $400

Brazil

Example Problem One: If you were to invest R$7 200 for one year at an annual rate of interest of 4%, how much money would you have at the end of the year? Assume interest is compounded annually. Solution Using Present and Future Values Calculator: Select Present and Future Values from the Calculators drop down on the home page. Click on the Radio button to indicate Select the Frequency as annual. In the Number of Payments field enter 1. In the Interest per Year field enter 4. In the Present Value field enter R$7 200. Click the button next to the Future Value field. FV = PV (1 + k)t = R$7 200 (1 + 0.04)1 = R$7 488 Example Problem Two: We will now reverse the above problem and ask how much the future value of R$7 488 one year from now is worth today at a discount rate of 4%. Solution Using Present and Future Values Calculator: Select Present and Future Values from the Calculators drop-down menu on the Home page. Click on the Radio button to indicate Select the Frequency as annual. In the number of payments field enter 1, since the future value is only being discounted once. In % Interest/year field enter 4. In the future value field enter the amount of R$7 488 Click on the button next to the Present Value field. PV = FV ÷ (1 + k)t = R$7 488 ÷ (1 + 0.04)1 = R$7 200

United Kingdom

Example Problem One: If you were to invest £60 for one year at an annual rate of interest of 4%, how much money would you have at the end of the year? Assume interest is compounded annually. Solution Using Present and Future Values Calculator: Select Present and Future Values from the Calculators drop down on the home page. Click on the Radio button to indicate Select the Frequency as annual. In the Number of Payments field enter 1. In the Interest per Year field enter 4. In the Present Value field enter £60. Click the button next to the Future Value field. FV = PV (1 + k)t = £60 (1 + 0.04)1 = £62.40 Example Problem Two: We will now reverse the above problem and ask how much the future value of £62.40 one year from now is worth today at a discount rate of 4%. Solution Using Present and Future Values Calculator: Select Present and Future Values from the Calculators drop-down menu on the Home page. Click on the Radio button to indicate Select the Frequency as annual. In the number of payments field enter 1, since the future value is only being discounted once. In % Interest/year field enter 4. In the future value field enter the amount of £62.40 Click on the button next to the Present Value field. PV = FV ÷ (1 + k)t = £62.40 ÷ (1 + 0.04)1 = £60

Russia

Example Problem One: If you were to invest руб.3 000 for one year at an annual rate of interest of 4%, how much money would you have at the end of the year? Assume interest is compounded annually. Solution Using Present and Future Values Calculator: Select Present and Future Values from the Calculators drop down on the home page. Click on the Radio button to indicate Select the Frequency as annual. In the Number of Payments field enter 1. In the Interest per Year field enter 4. In the Present Value field enter руб.3 000. Click the button next to the Future Value field. FV = PV (1 + k)t = руб.3 000 (1 + 0.04)1 = руб.3 120 Example Problem Two: We will now reverse the above problem and ask how much the future value of руб.3 120 one year from now is worth today at a discount rate of 4%. Solution Using Present and Future Values Calculator: Select Present and Future Values from the Calculators drop-down menu on the Home page. Click on the Radio button to indicate Select the Frequency as annual. In the number of payments field enter 1, since the future value is only being discounted once. In % Interest/year field enter 4. In the future value field enter the amount of руб.3 120 Click on the button next to the Present Value field. PV = FV ÷ (1 + k)t = руб.3 120 ÷ (1 + 0.04)1 = руб.3 000

China

Example Problem One: If you were to invest ¥650 for one year at an annual rate of interest of 4%, how much money would you have at the end of the year? Assume interest is compounded annually. Solution Using Present and Future Values Calculator: Select Present and Future Values from the Calculators drop down on the home page. Click on the Radio button to indicate Select the Frequency as annual. In the Number of Payments field enter 1. In the Interest per Year field enter 4. In the Present Value field enter ¥650. Click the button next to the Future Value field. FV = PV (1 + k)t = ¥650 (1 + 0.04)1 = ¥676 Example Problem Two: We will now reverse the above problem and ask how much the future value of ¥676 one year from now is worth today at a discount rate of 4%. Solution Using Present and Future Values Calculator: Select Present and Future Values from the Calculators drop-down menu on the Home page. Click on the Radio button to indicate Select the Frequency as annual. In the number of payments field enter 1, since the future value is only being discounted once. In % Interest/year field enter 4. In the future value field enter the amount of ¥676 Click on the button next to the Present Value field. PV = FV ÷ (1 + k)t = ¥676 ÷ (1 + 0.04)1 = ¥650

Malaysia

Example Problem One: If you were to invest RM300 for one year at an annual rate of interest of 4%, how much money would you have at the end of the year? Assume interest is compounded annually. Solution Using Present and Future Values Calculator: Select Present and Future Values from the Calculators drop down on the home page. Click on the Radio button to indicate Select the Frequency as annual. In the Number of Payments field enter 1. In the Interest per Year field enter 4. In the Present Value field enter RM300. Click the button next to the Future Value field. FV = PV (1 + k)t = RM300 (1 + 0.04)1 = RM312 Example Problem Two: We will now reverse the above problem and ask how much the future value of RM312 one year from now is worth today at a discount rate of 4%. Solution Using Present and Future Values Calculator: Select Present and Future Values from the Calculators drop-down menu on the Home page. Click on the Radio button to indicate Select the Frequency as annual. In the number of payments field enter 1, since the future value is only being discounted once. In % Interest/year field enter 4. In the future value field enter the amount of RM312 Click on the button next to the Present Value field. PV = FV ÷ (1 + k)t = RM312 ÷ (1 + 0.04)1 = RM300

Singapore

Example Problem One: If you were to invest S$130 for one year at an annual rate of interest of 4%, how much money would you have at the end of the year? Assume interest is compounded annually. Solution Using Present and Future Values Calculator: Select Present and Future Values from the Calculators drop down on the home page. Click on the Radio button to indicate Select the Frequency as annual. In the Number of Payments field enter 1. In the Interest per Year field enter 4. In the Present Value field enter S$130. Click the button next to the Future Value field. FV = PV (1 + k)t = S$130 (1 + 0.04)1 = S$135.20 Example Problem Two: We will now reverse the above problem and ask how much the future value of S$135.20 one year from now is worth today at a discount rate of 4%. Solution Using Present and Future Values Calculator: Select Present and Future Values from the Calculators drop-down menu on the Home page. Click on the Radio button to indicate Select the Frequency as annual. In the number of payments field enter 1, since the future value is only being discounted once. In % Interest/year field enter 4. In the future value field enter the amount of S$135.20 Click on the button next to the Present Value field. PV = FV ÷ (1 + k)t = S$135.20 ÷ (1 + 0.04)1 = S$130

Hong Kong

Example Problem One: If you were to invest HK$750 for one year at an annual rate of interest of 4%, how much money would you have at the end of the year? Assume interest is compounded annually. Solution Using Present and Future Values Calculator: Select Present and Future Values from the Calculators drop down on the home page. Click on the Radio button to indicate Select the Frequency as annual. In the Number of Payments field enter 1. In the Interest per Year field enter 4. In the Present Value field enter HK$750. Click the button next to the Future Value field. FV = PV (1 + k)t = HK$750 (1 + 0.04)1 = HK$780 Example Problem Two: We will now reverse the above problem and ask how much the future value of HK$780 one year from now is worth today at a discount rate of 4%. Solution Using Present and Future Values Calculator: Select Present and Future Values from the Calculators drop-down menu on the Home page. Click on the Radio button to indicate Select the Frequency as annual. In the number of payments field enter 1, since the future value is only being discounted once. In % Interest/year field enter 4. In the future value field enter the amount of HK$780 Click on the button next to the Present Value field. PV = FV ÷ (1 + k)t = HK$780 ÷ (1 + 0.04)1 = HK$750

India

Example Problem One: If you were to invest 4 500 for one year at an annual rate of interest of 4%, how much money would you have at the end of the year? Assume interest is compounded annually. Solution Using Present and Future Values Calculator: Select Present and Future Values from the Calculators drop down on the home page. Click on the Radio button to indicate Select the Frequency as annual. In the Number of Payments field enter 1. In the Interest per Year field enter 4. In the Present Value field enter 4 500. Click the button next to the Future Value field. FV = PV (1 + k)t = 4 500 (1 + 0.04)1 = 4 680 Example Problem Two: We will now reverse the above problem and ask how much the future value of 4 680 one year from now is worth today at a discount rate of 4%. Solution Using Present and Future Values Calculator: Select Present and Future Values from the Calculators drop-down menu on the Home page. Click on the Radio button to indicate Select the Frequency as annual. In the number of payments field enter 1, since the future value is only being discounted once. In % Interest/year field enter 4. In the future value field enter the amount of 4 680 Click on the button next to the Present Value field. PV = FV ÷ (1 + k)t = 4 680 ÷ (1 + 0.04)1 = 4 500

Caribbean

Jamaica   Example Problem One: If you were to invest J$8 300 for one year at an annual rate of interest of 4%, how much money would you have at the end of the year? Assume interest is compounded annually. Solution Using Present and Future Values Calculator: Select Present and Future Values from the Calculators drop down on the home page. Click on the Radio button to indicate Select the Frequency as annual. In the Number of Payments field enter 1. In the Interest per Year field enter 4. In the Present Value field enter J$8 300. Click the button next to the Future Value field. FV = PV (1 + k)t = J$8 300 (1 + 0.04)1 = J$8 632 Example Problem Two: We will now reverse the above problem and ask how much the future value of J$8 632 one year from now is worth today at a discount rate of 4%. Solution Using Present and Future Values Calculator: Select Present and Future Values from the Calculators drop-down menu on the Home page. Click on the Radio button to indicate Select the Frequency as annual. In the number of payments field enter 1, since the future value is only being discounted once. In % Interest/year field enter 4. In the future value field enter the amount of J$8 632 Click on the button next to the Present Value field. PV = FV ÷ (1 + k)t = J$8 632 ÷ (1 + 0.04)1 = J$8 300 Trinidad and Tobago   Example Problem One: If you were to invest TT$600 for one year at an annual rate of interest of 4%, how much money would you have at the end of the year? Assume interest is compounded annually. Solution Using Present and Future Values Calculator: Select Present and Future Values from the Calculators drop down on the home page. Click on the Radio button to indicate Select the Frequency as annual. In the Number of Payments field enter 1. In the Interest per Year field enter 4. In the Present Value field enter TT$600. Click the button next to the Future Value field. FV = PV (1 + k)t = TT$600 (1 + 0.04)1 = TT$624 Example Problem Two: We will now reverse the above problem and ask how much the future value of TT$624 one year from now is worth today at a discount rate of 4%. Solution Using Present and Future Values Calculator: Select Present and Future Values from the Calculators drop-down menu on the Home page. Click on the Radio button to indicate Select the Frequency as annual. In the number of payments field enter 1, since the future value is only being discounted once. In % Interest/year field enter 4. In the future value field enter the amount of TT$624 Click on the button next to the Present Value field. PV = FV ÷ (1 + k)t = TT$624 ÷ (1 + 0.04)1 = TT$600 Barbados   Example Problem One: If you were to invest Bds$200 for one year at an annual rate of interest of 4%, how much money would you have at the end of the year? Assume interest is compounded annually. Solution Using Present and Future Values Calculator: Select Present and Future Values from the Calculators drop down on the home page. Click on the Radio button to indicate Select the Frequency as annual. In the Number of Payments field enter 1. In the Interest per Year field enter 4. In the Present Value field enter Bds$200. Click the button next to the Future Value field. FV = PV (1 + k)t = Bds$200 (1 + 0.04)1 = Bds$208 Example Problem Two: We will now reverse the above problem and ask how much the future value of Bds$208 one year from now is worth today at a discount rate of 4%. Solution Using Present and Future Values Calculator: Select Present and Future Values from the Calculators drop-down menu on the Home page. Click on the Radio button to indicate Select the Frequency as annual. In the number of payments field enter 1, since the future value is only being discounted once. In % Interest/year field enter 4. In the future value field enter the amount of Bds$208 Click on the button next to the Present Value field. PV = FV ÷ (1 + k)t = Bds$208 ÷ (1 + 0.04)1 = Bds$200 Bermuda   Example Problem One: If you were to invest BD$100 for one year at an annual rate of interest of 4%, how much money would you have at the end of the year? Assume interest is compounded annually. Solution Using Present and Future Values Calculator: Select Present and Future Values from the Calculators drop down on the home page. Click on the Radio button to indicate Select the Frequency as annual. In the Number of Payments field enter 1. In the Interest per Year field enter 4. In the Present Value field enter BD$100. Click the button next to the Future Value field. FV = PV (1 + k)t = BD$100 (1 + 0.04)1 = BD$104 Example Problem Two: We will now reverse the above problem and ask how much the future value of BD$104 one year from now is worth today at a discount rate of 4%. Solution Using Present and Future Values Calculator: Select Present and Future Values from the Calculators drop-down menu on the Home page. Click on the Radio button to indicate Select the Frequency as annual. In the number of payments field enter 1, since the future value is only being discounted once. In % Interest/year field enter 4. In the future value field enter the amount of BD$104 Click on the button next to the Present Value field. PV = FV ÷ (1 + k)t = BD$104 ÷ (1 + 0.04)1 = BD$100 Bahamas   Example Problem One: If you were to invest B$100 for one year at an annual rate of interest of 4%, how much money would you have at the end of the year? Assume interest is compounded annually. Solution Using Present and Future Values Calculator: Select Present and Future Values from the Calculators drop down on the home page. Click on the Radio button to indicate Select the Frequency as annual. In the Number of Payments field enter 1. In the Interest per Year field enter 4. In the Present Value field enter B$100. Click the button next to the Future Value field. FV = PV (1 + k)t = B$100 (1 + 0.04)1 = B$104 Example Problem Two: We will now reverse the above problem and ask how much the future value of B$104 one year from now is worth today at a discount rate of 4%. Solution Using Present and Future Values Calculator: Select Present and Future Values from the Calculators drop-down menu on the Home page. Click on the Radio button to indicate Select the Frequency as annual. In the number of payments field enter 1, since the future value is only being discounted once. In % Interest/year field enter 4. In the future value field enter the amount of B$104 Click on the button next to the Present Value field. PV = FV ÷ (1 + k)t = B$104 ÷ (1 + 0.04)1 = B$100 Puerto Rico   Example Problem One: If you were to invest $100 for one year at an annual rate of interest of 4%, how much money would you have at the end of the year? Assume interest is compounded annually. Solution Using Present and Future Values Calculator: Select Present and Future Values from the Calculators drop down on the home page. Click on the Radio button to indicate Select the Frequency as annual. In the Number of Payments field enter 1. In the Interest per Year field enter 4. In the Present Value field enter $100. Click the button next to the Future Value field. FV = PV (1 + k)t = $100 (1 + 0.04)1 = $104 Example Problem Two: We will now reverse the above problem and ask how much the future value of $104 one year from now is worth today at a discount rate of 4%. Solution Using Present and Future Values Calculator: Select Present and Future Values from the Calculators drop-down menu on the Home page. Click on the Radio button to indicate Select the Frequency as annual. In the number of payments field enter 1, since the future value is only being discounted once. In % Interest/year field enter 4. In the future value field enter the amount of $104 Click on the button next to the Present Value field. PV = FV ÷ (1 + k)t = $104 ÷ (1 + 0.04)1 = $100

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